Aug. 6 (Bloomberg) -- Egypt deployed helicopter gunships
and an anti-terror team in north Sinai as President Mohamed
Mursi ordered the military to take “complete control” of the
region after unidentified militants killed 16 Egyptian soldiers.

Mursi, drawn from the ranks of the Muslim Brotherhood,
described yesterday’s attack on the troops as they broke their
Ramadan fast as a “cowardly” act and vowed the assailants
would “pay a high price, as would those who cooperate with
them,” the state-run Middle East News Agency reported.

The attack on the border post near the Rafah crossing with
the Gaza Strip comes a month after Mursi was sworn in as Egypt’s
first democratically elected civilian president. Security
nationwide has deteriorated since Hosni Mubarak’s 2011 ouster,
while Sinai has seen an increase in kidnappings of tourists and
attacks on security forces that have alternately been blamed on
al-Qaeda-affiliated militants and Bedouins.

Sinai has “become a kind of lawless no-man’s land, and it
seems to be getting worse,” Shadi Hamid, director of research
at Brookings Doha Center, said by phone. It’s also “probably
the one area where Egypt and Israel share some common ground.
The Muslim Brotherhood and Israel have an interest in
stabilizing the Sinai.”

Gunships Patrolling

Security forces and troops were moving into the region
hours after Mursi ordered them to hunt down the attackers.
Several gunships were sent in to patrol the area, Mohamed Saeed,
head of criminal investigation in north Sinai, said by phone, to
prevent other attackers from moving into the territory.

“The group that carried out yesterday’s attack, and those
standing behind them, are regarded by the armed forces as
enemies and must be met with force,” Egypt’s military council
said in a statement read on state television. It said 35 people
carried out the attack.

At Cairo International Airport, authorities turned away
Palestinians arriving by airplane because the Rafah crossing
into the Gaza Strip had been closed, the state-run Ahram Gate
reported, citing security officials.

The military said seven other soldiers were injured,
including three critically, in the attack. The assailants seized
two vehicles and tried to smash through the Israel frontier gate
before they were stopped by aircraft and Israeli gunfire,
officials said. At least seven militants were killed after
crossing the border, Israel’s Haaretz newspaper said.

‘Wakeup Call’

Israeli Defense Minister Ehud Barak said in an e-mailed
statement by his ministry that the attackers had suicide-bomber
vests and that, along with the amount of explosives brought in a
small truck at the start of the incursion, “could have caused
very serious damage.”

“I appreciate that this will not be the last time we come
across attempts to harm us,” he said while touring the border
region. “I hope this will be a wakeup call for Egypt regarding
the necessity to be sharp and efficient on their side.”

Israeli Foreign Minister Avigdor Liberman said “we need to
understand this war is continuing daily and it is clear today
also to Egypt that it is an interest of Egypt to stop this.”

Liberman said a barrage of rockets fired from the
Hamas-controlled Gaza Strip fell on southern Israel around the
time of yesterday’s attacks. While he didn’t connect the two, he
repeated his position that “there must be an end to the
terrorist regime in Gaza. Everyone knows what needs to be done
and decisions need to be made.”

Stable Sinai

Mursi’s election raised concerns in Israel, which enjoyed
peace with Egypt under Mubarak. The ousted president was seen as
the Israel’s greatest ally in the region, cooperating on
security and the blockade of the Gaza Strip. Mursi and the
Brotherhood have repeatedly said Egypt will honor its
international agreements -- a reference to the Camp David peace
accords.

“In theory, Israel and Egypt share an interest in
stabilizing the Sinai,” Hamid said. “In practice, it looks
very different.”

Mursi must deal with a neighboring government that views
the Brotherhood with suspicion and secure a largely desolate
peninsula whose southern half and coast are tourist attractions.
Last August, gunmen operating out of Sinai attacked near the
southern Israeli city of Eilat, killing eight Israelis and
injuring about 40 people. A natural gas pipeline feeding into
Israel and Jordan has been attacked 15 times since Mubarak’s
fall.

‘Huge Challenge’

“What is really needed now is close cooperation between
the Egyptian and Israeli militaries, but I’m skeptical that will
happen given the political atmosphere in Cairo,” Zvi Mazel,
Israel’s ambassador to Egypt from 1996 to 2001, said by phone.

Mursi has been locked in a power struggle with the generals
who ruled Egypt after Mubarak’s ouster. The military council
handed power to Mursi in June after stripping his office of some
of its authority while assuming new powers for itself.

“It’s a huge challenge for Mursi,” said Khalil al-Anani,
political analyst at the U.K.’s Durham University. Mursi is
still engaged in a political tug-of-war with Egypt’s military
council and “such an attack will put him in a bad situation if
he asks for more powers.”